GBP/USD – Back to the Lows?

After making several failed attempts at 1.3500 cable is back towards the key 1.3000 support level as the sellers continue to put pressure on the unit. Although the political resolution of Brexit is moving slowly, the market is now focused on the possible easing by BoE which could cut rates as much as 50bp at their meeting in August.

In the meantime the markets will focus on the eco data from UK, with tomorrow’s UK labor numbers coming next. The market anticipates a rise in jobless claims by 3.9K but the uptick could be bigger given the shock of Brexit on UK businesses which likely suspended all hiring for now. A big jump in unemployment figures would only spook the market further and could send cable towards a test of the key 1.3000 level.

A break there would up retest of the post Brexit lows at the 1.2800 figure, meanwhile the upside is firmly capped by 1.3500 top.